Keeping Tabs on Who is a Full-Time Employee

11 February 2015

The ACA requires that larger employers offer medical insurance to full-time employees and report on their offer of coverage after the end of the year. To make sure that you're correctly administering the offer of medical insurance—or at least to know the amount of potential liability you'll face for failing to offer insurance—employers should have a separate method of track who is a full-time employee for the purposes of the ACA.

This could be something as simple as a separate Excel spreadsheet with a list of the full-time employees by month, or you could program this function into your HRIS system. The point is that you want to be able to tell who is a full-time employee and for what months of the year so that you can link that information to the IRS reporting that you'll need to complete in Q1 2016.

How does this list comport with the measurement and stability periods? First you determine who is a full-time employee from the measurement period, and so everyone who works 1560 hours during the year-long measurement period is a full-time employee for the next stability period. All those employees get marked as full-time for all twelve months of the year, regardless of whether they decrease hours or actually maintain full-time hours.

Example quote mid-story.

For new hires, you determine whether they're full-time employees based on whether you expect them to work 30+ hours per week at the time of hire, i.e. are you hiring them for a full-time position or not? If they're full-time, then they're full-time employees starting with the month of hire, and you will report on whether you've offered them health insurance starting with the month of hire. There is no provision for expecting an employee to work for only a few months, so temporary employees must be considered full-time employees from the beginning if you're expecting them to work full-time hours.

For new hires who aren't full-time (again, 30+ hours/week) employees based on the position, you'll have to mark the date of hire and run an initial measurement period beginning either on the date of hire or on the first of the month following the date of hire. After measuring the hours for a year, you then consider that employee a full-time employee based on that initial measurement period, effective the first of the month following a whole month after the close of the initial measurement period. That employee is a full-time employee for at least a year under an initial stability period.

Yes, it's confusing. So here's a chart featuring Dave, a per diem nurse: